Critics have often blamed President Rouhani of Iran for blindly following the neoclassical-neoliberal model of capitalism. The critical problem with Mr. Rouhani’s economic policies, however, is more than just following the dominant economic model of neoliberalism; more gravely, it is following the worst aspects of that model … //

… It is now widely acknowledged that the disproportionate growth of the financial sector has been a major contributing factor to the ongoing financial turbulence and economic stagnation in many core capitalist countries. What is relatively less known outside of Iran is that the parasitic growth of the financial sector in that country is among the highest in the world: per capital number of banks, shadow banks and other financial institutions (called moasesaat-e atebaari) is certainly the highest in the world. Parasitic activities of the financial players include speculation in foreign exchange or foreign currency market, in gold and other precious metals market, in all kinds of imports (both legal and illegal), in real estate, and the like [3].

Returns to speculative activities in the financial sector are so high that a number of major manufacturing corporations such as Iran Khodrow (the country’s largest auto manufacturer) have established their own banks in order to partake in the lucrative financial sector by diverting funds from their manufacturing operations to this sector. Likewise, many civil, military, and governmental organizations (such as municipalities), as well as pension funds and charity foundations (such as Bonyad-e Mostazafan) have also created their own banks in pursuit of a share in the lucrative financial sector.

The perils of the commercial banks’ and other financial institutions’ speculative activities are dangerously magnified by their ability to create money! Following the Anglo-Saxon model of fractional reserve banking (explained below), which is today practiced in most capitalist countries, the power of money creation in Iran rests not so much with the government as it does with commercial banks. When commercial banks make loans or extend credit to their clients they, in effect, create money, which is called debt/credit money, or bank money, as opposed to sovereign or real money created by the government. Although in essence bank money is not real money, in practice it functions just as real money.

The ability of the commercial banking system to create money explains why the all-important power of controlling or manipulating money supply, of financing and, therefore, of influencing or controlling national economies in most capitalist countries has increasingly come to rest with commercial banks, often mediated by central banks and treasury departments that are frequently headed by the proxies of the financial oligarchy … //

… In brief, there is no shortage of finance capital in Iran. The problem is that it is used largely for speculation, not production, purposes. To divert its financial resources from speculation to production, Iran needs to (a) prevent the commercial banks from engaging in non-banking activities; (b) prevent the commercial banking system from creating debt money, based on fractional reserve system; (c) confer the prerogative of creating real, sovereign money solely to the state-owned central bank; and (d) mandate that the real, tender money thus created is spent into the economy/circulation through its outlays on social, developmental, infrastructural, and other vital national projects. Only through such a drastic overhaul of money and banking policies, along with a vigorous support for its manufacturers through an effective policy of import-substitution, can Iran rekindle its dormant economy and chart a new path of industrialization, development and real independence.

The no handshake that shook the world, on Al-Ahram weekly online, by Mona El-Nahhas, Aug 16, 2016: the anti-Israel stance of an Egyptian judoka during the Rio Olympics continues to produce heated reaction;

What Remains of All Our Outrage? on Zmagazine, by Esther Vivas, June 26, 2016: it’s been five years since the massive occupation of May 15, 2011 that gave birth to the movement of los indignados, 15M. Five years of faltering progress with many advances along the way …;